When Stephen Colbert, the host of the Colbert Report comedy show, sits down with Google CEO Eric Schmidt, you don’t expect a round of worn out jokes. “My guest tonight is the CEO of Google – at least that’s what it said when I looked him up on Bing,” joked Colbert announcing his guest yesterday evening.

A short interview ensued, which covered a few controversial topics. Asked whether Google was basically “data mining what we Americans care about,” Schmidt quipped “Not true.” He reminded people that even though Google’s ten-year-old PageRank algorithm sees your searches, the company forgets them “after a while” due to the pressure from lawmakers in various countries.

He didn’t share any new information as to why Google pulled out of China past this quote:

We didn’t like their laws. There’s Hong Kong and mainland China – we like the Hong Kong system better.

The amusing moment came when Schmidt explained his quote about kids being able to wipe out their online identity when they turn eighteen in order to escape their cyber-past. “It was a joke,” Schmidt admitted, which prompted the comedian to note something like this would have actually been a great idea (and I agree with him).

It’s an amusing interview that revealed Schmidt’s uneasiness whenever Colbert pressed him on the subject of privacy or Google’s collection of obscene amount of data from online users. Check out the video segment below or watch the entire Colbert Report episode from yesterday evening here.